Morningstar Fund Ratings: Weekly Round-up

In this week's ratings round-up, we unveil the latest upgrades and downgrades from Morningstar's analysts 

Shannon Kirwin 30 November, 2021 | 9:56AM
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Man GLG Japan CoreAlpha Professional Acc C  - Bronze from Neutral

Daniel Haydon

The continuity provided by veteran portfolio manager Jeff Atherton, together with some sensible process enhancements to this contrarian value strategy under his leadership means we see positives here. As a result, the clean C share class has been upgraded to a Morningstar Analyst Rating of Bronze (previously Neutral). Fund performance has lagged in recent years due to value being strongly out of favour in Japan, but it has successfully captured the value rotation since the advent of the vaccine in 2020. The extreme value nature of the strategy can lead the fund to fluctuate between top- and bottomquartile performance, but it should be expected to outperform in value-led markets and also over the very long term.


PIMCO GIS Euro Credit Institutional EUR  –  Bronze from Silver

Shannon Kirwin

PIMCO GIS Euro Credit has seen its People score downgraded from High to Above Average, resulting in a downgrade of its Morningstar Analyst Rating from Silver to Bronze for all of its institutional share classes, including the Institutional EUR clean share class. Its pricier E share class retains its Neutral rating. While we remain confident in the strategy’s approach and its lead manager, Eve Tournier, the credit research team backing her experienced some upheaval recently. After the firm shuttered its Munich office in Spring 2021 and requested that its Munich employees relocate to London, four of the ten analysts who provide bottom-up ideas to the strategy opted to leave the firm. The individuals were quickly replaced with experienced hires, and a long-tenured core of credit analysts remains in place. Still, the team in its new form is still establishing itself, prompting us to moderate our conviction. 

Schroder ISF Asian Equity Yield C  - Silver from Gold

Samuel Lo, CFA

Schroder ISF Asian Equity Yield continues to benefit from a topnotch manager, supporting team, and investment process. King Fuei Lee has helmed this strategy since its 2004 inception and has consistently impressed us with his keen insights and passion for investing over the years. He is supported by one of our favourite teams in the region, boasting 40 analysts with 15 years of investment experience and seven years of firm tenure on average. The investment approach, which focuses on companies with sustainable and growing dividends, has been steadfastly applied over the years to produce strong longterm results. We maintain our conviction and reiterate both the People and Process ratings at High. Nevertheless, owing to changes in the competitive landscape within the Asia Pacific ex Japan equity income Morningstar Category, the Morningstar Analyst Ratings for the Luxembourg vehicle’s clean C share classes have been driven down to Silver from Gold, and several share classes have been downgraded to Bronze from Silver. The other share classes retain a Gold or Silver rating, depending on their fee levels.

As part of Morningstar's enhanced methodology for Analyst Ratings, different share classes have different Ratings

The information contained within is for educational and informational purposes ONLY. It is not intended nor should it be considered an invitation or inducement to buy or sell a security or securities noted within nor should it be viewed as a communication intended to persuade or incite you to buy or sell security or securities noted within. Any commentary provided is the opinion of the author and should not be considered a personalised recommendation. The information contained within should not be a person's sole basis for making an investment decision. Please contact your financial professional before making an investment decision.

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About Author

Shannon Kirwin  is a fund analyst with Morningstar